At UN-Habitat’s World Urban Forum 9, a pressing question was how to integrate informal settlements into the formal city. Community land trusts might be the way to start.

KUALA LUMPUR—As with past editions of the global conference on cities, the ninth World Urban Forum kept coming back to the stubborn question of what to do about slums.

An estimated 900 million people live in informal settlements, according to UN-Habitat, the organizer of the event, which concluded last week in the Malaysian capital. According to various estimates, one in four city dwellers is in an area lacking basic services, and the majority of all new housing worldwide is technically built illegally.

Over the decades, governments have tried a range of strategies, from outright eviction and bulldozing to massive relocations into public housing. The latter has not worked especially well, because the new housing is most often built on cheap land at the urban periphery, far from jobs. An estimated 5 million housing units are vacant or under-occupied across Latin America, having been abandoned by the households who were relocated there.

The most prominent alternative policy has been to leave residents in place and attempt to “regularize” informal settlements by giving people legal title to their property, so they can own the homes they have built. Sometimes authorities will intervene with targeted upgrades, such as new schools and libraries, public spaces, water and sanitation facilities, and expanded transportation options. The cable cars of Medellin are a well-regarded example of this approach.

Yet problems arise with it as well—namely, the prospect of gentrification and real-estate speculation. Some residents actually refuse to accept title on their homes and resist upgrades out of fear that rising values or the prospect of taxes will ultimately force them to leave their communities.

So it is that one of the most promising new policies in global urbanization has emerged: allowing residents of informal settlements to control their own destiny through community land trusts. This arrangement, in which land is collectively owned, effectively protects homes from real-estate speculation.

A CLT addresses the number-one concern of residents in informal settlements: the promise of being able to stay.

There are more than 250 community land trusts, or CLTs, in the United States. Typically, a municipality and a non-profit organization (such as a community development corporation) work together to purchase a plot of land. Residents can either rent or buy the homes, which may be existing homes or new construction. But the cost of the land—the biggest factor in housing markets—is taken out of the equation. One of the first attempts to create a CLT in an informal area is Fideicomiso de la Tierra, or the Caño Martín Peña Community Land Trust, along the Martín Peña Canal in San Juan, Puerto Rico. That effort was inspired in part by the Dudley Street Neighborhood Initiative in the Roxbury section of Boston.

A CLT addresses the number-one concern of residents in informal settlements: the promise of being able to stay in the communities where they have lived for years, said Theresa Williamson, founder of Catalytic Communities. Legislation allowing for the creation of CLTs would give residents of Brazil’s favelas a feeling of control as those settlements are integrated into the formal city, Williamson said, speaking at the Lincoln Institute of Land Policy late last year. (The Lincoln Institute is supporting her efforts to ascertain the legal and political feasibility of CLTs in Brazil.)

A major test of the concept may unfold in one neighborhood in Buenos Aires that embodies the challenge of that integration: Villa 31. An 80-year-old shantytown of about 40,000 residents densely settled on 100 acres, Villa 31 sits literally on the other side of the tracks from the booming downtown neighborhoods of Buenos Aires. The label villa comes from the Argentinian phrase loosely translated as “village of misery.”

Bolstered by funding from the World Bank and the Inter-American Development Bank (IDB), the city government teed up a $320 million initiative to bring services and transformation to Villa 31: health clinics, housing centers, and plans for a new school and government offices right in the heart of the neighborhood.

Children in Villa 31 at a new playground, one of the improvements the city government has made in the community. (Marcos Brindicci/Reuters)

An entrepreneurship center—symbolically, in a narco bank that authorities had seized and closed—paid immediate dividends, said Diego Fernandez, the city’s secretary for social and urban integration, who appeared at a packed session at the World Urban Forum with Francisca Rojas, urban development and housing specialist at the IDB. A shopkeeper learned to track sales on a spreadsheet, allowing her to take a day off to tend to errands on the day with the least sales.

In that kind of urban acupuncture, it’s the little things—like learning how to manage data about sales and inventory—that can make a big difference. The area has a lot to build on. According to research by Cynthia Goytia, an urban economics professor at Torcuato Di Tella University in Buenos Aires, the commercial activity in Villa 31 is on par with malls in the formal city.

Commercial activity in Villa 31 is robust. (Anthony Flint)

Throughout the community, the city has overhauled playgrounds once occupied by drug dealers, burnished soccer fields, built 1,200 new homes, and renovated 500 existing dwellings. Still, building trust remains a major challenge, and fears of gentrification persist—that if the neighborhood gets this much attention, it’s only a matter of time before it becomes as swanky as the redeveloped industrial waterfront of Puerto Madero just to the south. Some people declined to have their homes renovated. Some people didn’t mind living under the expressway, despite the international design competition to transform the viaduct into a park. The early sketches look eerily similar to the High Line in Manhattan, where rents have soared.

Houses under an expressway. Some residents of Villa 31 are concerned about a plan to turn the viaduct into a park. (Anthony Flint)

A CLT is being considered to address these concerns, Fernandez said, although officials want to be sure to emphasize that residents will have home ownership. “That’s culturally important,” he said.

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One of the UN’s Sustainable Development Goals calls for making cities inclusive, safe, resilient, and sustainable. The right to adequate and affordable housing is a major tenet of the New Urban Agenda, the implementation of which was the main focus of the Kuala Lumpur Declaration coming out of World Urban Forum 9. If housing can be made more affordable generally, there would be less need for the poor to occupy land any way they can. “Formal or informal, we have to bring dignity to these areas,” said Claudio Acioly, head of capacity building for UN-Habitat.

But the work is not done in a vacuum. The vagaries of land markets permeate all the efforts to improve conditions for the poor in cities, just as sure as the thunderstorms that drench Kuala Lumpur just about every afternoon.

CORRECTION: An earlier version of this article misspelled the name of Francisca Rojas. The article has been updated.

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